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AbuDhabiStablecoin 100word
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Abu Dhabi is advancing its position as a global crypto hub through the introduction of a regulatory framework for Fiat-Referenced Tokens (FRTs), a category of stablecoins pegged to a single fiat currency. The Financial Services Regulatory Authority (FSRA) of the Abu Dhabi Global Market (ADGM) published a consultation paper in August 2024, outlining proposals for the issuance of FRTs. The consultation period concluded on October 3, 2024, with the FSRA considering feedback to finalize the framework.ADGM+9Cointelegraph+9merklescience.com+9ADGM+7blockchainnewsgroup.com+7ADGM+7
The proposed regulations mandate that FRT issuers maintain reserve assets equal to or exceeding the par value of all outstanding tokens, ensuring full backing. These reserves must be high-quality, liquid assets denominated in the same currency as the FRT and can be liquidated rapidly with minimal adverse price effect. Issuers are also required to provide daily mark-to-market valuations and segregate reserve pools for each token issued. Mondaq+2Cointelegraph+2blockchainnewsgroup.com+2Cointelegraph+2ADGM+2ADGM+2
The FSRA's framework introduces FRT issuance as a distinct regulated activity within ADGM's financial services regime, incorporating governance and integrity measures, transparent disclosure requirements, and prudential safeguards. This approach aims to balance innovation with strong regulatory oversight, providing regulatory certainty while maintaining high standards of financial stability and investor protection. ADGM+1Fintech News+1
In line with these developments, Tether announced plans to launch a stablecoin pegged to the UAE dirham, backed by UAE reserves. This initiative, pending Central Bank approval, reflects the UAE's growing role in the global cryptocurrency landscape. Reuters
These regulatory advancements and industry initiatives position Abu Dhabi as a leader in the development of a secure and transparent
